sustainable marketing

1. Marquette University
e-Publications@Marquette
Marketing Faculty Research and Publications Marketing, Department of
4-1-2014
Fostering Fair and Sustainable Marketing for Social
Entrepreneurs in the Context of Subsistence
Marketplaces
Tina M. Facca-Miess
John Carroll University
Nicholas J. C. Santos
Marquette University, nicholas.santos@marquette.edu
Accepted version. Journal of Marketing Management, Vol. 30, No. 5-6 (April 2014): 501-518. DOI. ©
2014 Taylor & Francis (Routledge). Used with permission.

2. Fostering fair and sustainable marketing for social entrepreneurs in the context of
subsistence marketplaces
Tina M. Facca, Ph.D.
Assistant Professor of Marketing
Boler School of Business
John Carroll University, Ohio
tfacca@jcu.edu
216-397-1718
Nicholas J. C. Santos, Ph.D.
Assistant Professor of Marketing
College of Business
Marquette University, WI
nicholas.santos@marquette.edu
414-288-1444
Tina M. Facca is an Assistant Professor of Marketing at John Carroll University in the
Boler School of Business. Her extensive market research experience spans varied
industries including professional services, foodservice and hospitality, entertainment,
healthcare, and non-profit organizations. She has published in the fields of marketing,
entrepreneurship, leadership, and mathematical statistics. Dr. Facca earned her Ph.D. in
Economics at Göttingen University, Germany. She holds a Master of Science in Statistics
from Case Western Reserve University as well as a Master of Applied Communication
Theory and Methodology, and a Bachelor of Arts in Communication from Cleveland
State University.
Nicholas J.C. Santos is an Assistant Professor of Marketing at Marquette University in
the College of Business. His research interests include marketing strategies for
impoverished market segments, social entrepreneurship, corporate social responsibility,
business ethics and the interaction between marketing and society. He has published in
numerous journals such as the Journal of Public Policy & Marketing, the Journal of
Macromarketing, the Journal of Business Ethics, and Business and Politics. He holds an
interdisciplinary Ph.D. in Marketing, Management and Ethics from Marquette University
and has graduate and undergraduate degrees in business, theology, and philosophy.

3. 2
Fostering fair and sustainable marketing for social entrepreneurs in the context of
subsistence marketplaces
Abstract:
In recent years, in-depth, on-the-ground research has generated many insights into the
nature and functioning of subsistence marketplaces and the people who operate in them.
Such knowledge is bound to be useful to various companies and organizations as they
seek to engage with such marketplaces. However, in addition to practical insights, it is
also important to have ethical norms that can govern such engagement so as to foster
fairness and equity in subsistence marketplaces. With that aim in mind, practical
marketing guidelines suggested by a recent study are supplemented with a normative
ethical framework for marketing, labeled the integrative justice model. Tactics for fair
and sustainable marketing planning for social entrepreneurs are suggested.
Additionally, future directions for social entrepreneurship marketing in subsistence
contexts are discussed.
Summary statement of contribution:
This work proposes tactical suggestions for marketing planning for social entrepreneurs
in the context of subsistence marketplaces. These suggestions are based on practical
insights gathered from the field as well as ethical norms that ought to govern this
planning. As such, these tactics are expected to foster fair and sustainable marketing in
subsistence marketplaces.
Keywords:
Social entrepreneurship, subsistence marketplaces, integrative justice model, marketing
planning, fair and sustainable marketing.

4. 3
Introduction
A marketer who is evaluating potential engagement with the impoverished is
challenged at multiple levels. Unfortunately, it is unlikely that the marketing manager’s
education or experience has even touched on marketing in impoverished settings, let
alone required rigorous evaluation of the nuances associated with marketing to, for or
with the poor in subsistence marketplace. This contribution addresses this issue by
proposing the use of a normative ethical framework labeled the integrative justice model,
or IJM (Santos & Laczniak, 2009) which is entirely consistent with familiar marketing
frameworks, including service dominant logic (Vargo and Lusch, 2004) and value co-
creation (Prahalad and Ramaswamy, 2004), to synthesize a new framework for fair and
sustainable marketing when poverty is the context, and subsistence the norm.
Extant research in the areas of social entrepreneurship and subsistence
marketplaces provides rich texture to the fair and sustainable marketing framework
proposed here. Suggested tactics for marketing planning in these unique contexts are
offered to facilitate practical application and implementation. This work is meant to
encourage marketers and social entrepreneurs to embrace this challenging marketplace
with innovative variations on familiar frameworks, tailored to the nuances of subsistence
living, yet with the compassion and clarity of vision intrinsic to sustainable human
development in subsistence marketplaces.
In the business ethics literature, Santos and Laczniak (2009) initially introduced
their theoretical discussion of justice in marketing among the impoverished from the
perspective of Catholic Social Teaching, deriving from it important characteristics of

5. 4
fairness when engaging such markets. These essential elements include 1) authentic
engagement with consumers, particularly impoverished ones, with non-exploitive intent.
2) Co-creation of value with customers, particularly those who are impoverished, 3)
Investment in future consumption, 4) Interest representation of all stakeholders,
particularly impoverished customers, and 5) Focus on long-term profit management
rather than short-term profit maximization. The IJM is then developed in the marketing
and public policy literature, primarily in the context of multinational corporations
(MNCs) operating in emerging markets (2009). Further, the key operational elements of
the IJM are shown to conform to the foundational premises of service dominant (SD)
logic, extending it to societal and ethical concerns, and connecting it to macromarketing
frameworks including distributive justice and sustainability (Laczniak and Santos, 2010).
Recently, the IJM has been applied to social entrepreneurial organisations (SEOs) with
minor adaptations including empowerment as part of authentic engagement; a focus on
the root causes of problems associated with poverty; creation of sustainable ecosystems
through innovative social changes; a continued focus on interest representation of
disadvantaged segments; and financial viability and sustainability (Santos, 2013).
The IJM has been discussed in the literature from the perspectives of 1)
marketing to the poor, as in the case of the MNC operating or distributing in emerging
markets, and 2) marketing for or on behalf of the poor, as would an SEO. However, the
IJM has not yet been applied specifically to 3) marketing with the poor, which is an
essential, intrinsically just, and more sustainable position for marketers working within
the context of subsistence marketplaces. We suggest that in subsistence marketplaces,
when the social entrepreneur’s marketing function is managed in collaboration with those

6. 5
served by its outcomes, the potential for sustainable positive impact is far greater. The
IJM provides a normative framework for social entrepreneurial marketers (SEMs)
collaborating with the impoverished in subsistence markets. The growth of social
entrepreneurship over the last few decades has been accompanied by a relatively high
degree of ambiguity about its defining characteristics. Such confusion is likely the result
of different kinds of organizations (for-profit, nonprofit, government, social enterprises
etc.) engaging in activities that could technically fall under the purview of social
entrepreneurship. Therefore, an understanding of social entrepreneurship in the context of
subsistence marketplaces and an identification of the key characteristics of these
marketplaces are provided at the beginning. The integrative justice model (IJM) is
elaborated upon and a brief synopsis of the marketing practices proposed by Weidner et
al. (2010) is provided. Based on these two frameworks certain tactics for marketing
planning for social entrepreneurs who operate in subsistence contexts are proposed. It is
expected that these tactics can help foster fair and sustainable marketing for social
entrepreneurs in the context of subsistence marketplaces. Additionally, areas of further
research are identified.
Varied Forms of Social Entrepreneurship
Case example 1
Hapinoy is an initiative of Microventures Inc. (for-profit) and Microventures
foundation (non-profit) that creates an enabling environment for sari-sari stores [micro-
retail outlets] in the Philippines to function more efficiently (Arceo-Dumlao, 2012). It
does this at two levels: on one level, it provides education, access to capital, innovative

7. 6
solutions and products, and at another level, it creates a community of entrepreneurs
helping to create a network of stores rather than stores that function in isolation.
Case example 2
Banco Azteca is a large bank in Mexico that was founded in 2002 and one that is
involved in microlending. Its parent company is Grupo Elektra, Latin America’s largest
electronics and home appliance chain that is part of the Salinas group of companies.
Taking advantage of lax government oversight and the dire situation of poor consumers,
Banco Azteca charges annual interest rates ranging from 50% to 120%, leaving many of
its already impoverished customers trapped in a maze of debt (Epstein & Smith, 2007).
The case examples above are both entrepreneurial initiatives that engage a
subsistence population. Hapinoy provides various services and products to subsistence
entrepreneurs (the sari-sari store owner) while Banco Azteca provides credit to mainly
subsistence consumers and entrepreneurs. The first example, namely Hapinoy, is that of a
social entrepreneur while the second, namely Banco Azteca, is that of a traditional
entrepreneur. A question that arises from reviewing the two case examples is: which of
them might more likely exemplify a “win-win” situation for all participants? Such an
enquiry is pertinent in the current context where a social entrepreneurial initiative such as
microfinance is coming under increased scrutiny. Consider the spate of farmer suicides in
southern India that were attributed to high-interest rates and high-pressure tactics for
repayment used by microlenders (Associated Press, 2012). The initial public offerings of
microlenders, such as Compartamos in South America and SKS in India, were criticized
by Muhammed Yunus, regarded as the founder of microfinance, as pushing microfinance
in the loansharking direction (Roodman, 2010). As subsistence marketplaces, also

8. 7
characterized as the base or bottom of the pyramid market, become increasingly attractive
to various entities for varied reasons, it is imperative that engagement in these
marketplaces be governed by some normative guidelines for “fair” and “sustainable”
marketing. Such guidelines can help ensure that subsistence marketplaces do indeed
benefit from social entrepreneurial activity (cf. Santos, 2013).
The Skoll Foundation (n.d.) defines social entrepreneurs as society’s change
agents, creators of innovations that disrupt the status quo and transform the world for the
better. However, many for-profit enterprises would also fit this definition. Consider the
social good that companies such as Facebook and Skype have created in helping people
share stories and connect with each other across the globe. Martin and Osberg (2007)
suggest that confusion arises because both the entrepreneur and the social entrepreneur
are strongly motivated by the opportunity they identify, pursue that vision relentlessly,
and derive considerable psychic reward from the process of realizing their ideas.
However, what distinguishes social entrepreneurs from other entrepreneurs is that in the
case of the former, social benefit and “social mission achievement” is central (Kickul &
Lyons, 2012). Martin and Osberg (2007) define social entrepreneurs as having the ability
to identify an unjust equilibrium, develop a social value proposition, and stabilize a new
ecosystem around a new equilibrium that ensures a better future for the targeted group
and society. Zahra , Gedajlovic, Neubaum, and Schulman (2009) offer a comparable
definition with a focus on innovation. Huybrechts and Nicholls (2012) highlight three
features of a social entrepreneur common to most definitions. These include a primary
focus on social and environmental outcomes over profit maximization; an innovative
mindset, and a market orientation. Dacin, Dacin, and Tracey (2011) suggest that social

9. 8
entrepreneurs create social value by providing solutions to problems. To overcome the
ambiguity associated with social entrepreneurship, Santos (2013, p. 135) prefers to use
the term “social entrepreneurial organization” (SEO), and defines it as ‘one that aims at
co-creating social and/or ecological value by providing innovative and lasting solutions
to social and/or environmental problems through a process of empowerment and in a
financially sustainable manner.’
Subsistence Marketplace Insights
Comprising subsistence marketplaces are the roughly four billion people living on
less than $2 a day, in truly abject poverty, who are commonly referred to as constituting
the base or bottom of the pyramid. (Hammond et al., 2007; Prahalad, 2005; Viswanathan
& Rosa, 2007; Viswanathan & Sridharan, 2009). An in-depth and insightful study by
Viswanathan et al. (2012) identifies seven themes that characterise marketing interactions
in subsistence marketplaces. These are: interdependence and orality (marketplace
context); empathy and enduring relationships (interactional environment); fluid
transactions, constant customization, and buyer-seller responsiveness (elements of
exchange).
Various traits shared by consumers in poverty conditions include their tendency to
process single pieces of information, such as price, while challenged when attempting to
derive higher-level abstractions such as price and package size simultaneously.
Consumers in subsistence contexts are photographic thinkers, viewing brand names and
prices as images in a scene instead of symbols or messages requiring reading and reaction.
Given that many are at low literacy levels, their self-esteem in decision-making contexts

10. 9
must be considered. They may avoid weighing product attributes in a public market, to
avoid embarrassment should others identify their low literacy (Viswanathan, Gajendiran,
& Venkatesan, 2008). These qualities suggest to marketers that the presentation of a
product or service must be simple and focused in order to clearly communicate its
benefits.
A critical differentiator in subsistence marketplaces is one-on-one nature of
buyer-seller relationships. The mutually beneficial relationship between parties in an
economic exchange is deeper in that they share the experiences and tribulations of
subsistence living. Many individuals are both consumers and entrepreneurs sustaining
their own micro-enterprises to support themselves and their family. Given this sense of
camaraderie in desperately adverse conditions, individuals do understand the importance
of a fair exchange at the seller level as well at the buyer level. Therefore, fair and
transparent exchanges are essential for businesses in subsistence marketplaces
(Viswanathan, Gajendiran, & Venkatesan, 2008).
Viswanathan and Sridharan (2009) stress the need for businesses considering
serving subsistence marketplace to have a true understanding of sustainability if they
want to succeed in these marketplaces. Macro-level market economies like the United
States emphasize economic sustainability, whereas micro-level subsistence marketplaces
tend to emphasize social or environmental sustainability. Collaboration with
governmental initiatives, social enterprises, business efforts, and local enterprises is
essential. If a sustainable, cooperative foundation is set by businesses, these
underdeveloped economies have the potential to develop in a mutually beneficial and
balanced way.

11. 10
So how can social entrepreneurs market successfully in subsistence marketplaces?
Viswanathan and Sridharan (2009) propose that businesses ought to be prepared to follow
a different set of rules of engagement with consumers in these marketplaces with a give
and take mindset of mutual learning. Subsistence marketplaces cannot be developed
according to the same principles and mindset of a First World economy. For example,
social capital plays an integral role in successful entrepreneurship and, relationships and
partnerships can solve problems that money and labor cannot (Viswanathan & Sridharan,
2009). Further, a symbiotic rather than individualistic relationship needs to be established
where developed markets contribute resources and technology and subsistence
marketplaces contribute productivity and innovation with sustainability principles
embedded in their processes. For marketers, it would seem that the role of marketing in
such an economy is not to merely communicate an offering to the consumer; it also
involves much more in-depth relationship building and learning from those served. The
new rules of engagement that Viswanathan & Sridharan (2009) propose for businesses
desirous of entering subsistence marketplaces would also be applicable to social
entrepreneurs that operate within these marketplaces.
Subsistence Marketplace Frameworks for Solutions
From the above discussion, a social entrepreneur could be considered to be an individual
who is focused on devising and implementing innovative and lasting solutions to social
and/or environmental problems. As such, a social entrepreneur can be distinguished from
a subsistence entrepreneur; the latter primarily focused on earning a subsistence income,
that is, income to meet theirs and their family’s daily needs. In contrast, social
entrepreneurs are involved in initiatives that are aimed at large scale, systemic change

12. 11
that is far beyond the scope of the individual entrepreneur’s subsistence needs.
Additionally, a social entrepreneur can operate in a subsistence as well as non-
subsistence marketplace. Consider Mark Ruiz, the co-founder of the Hapinoy initiative in
the Philippines, the case example mentioned earlier. Mr. Ruiz is an example of a social
entrepreneur operating in a subsistence marketplace (Harless, 2012). Conversely,
consider Gemma Mortensen, the founder of Crisis Action, a socially entrepreneurial
initiative that acts as a catalyst and coordinator bringing human rights and humanitarian
organizations together to advocate on behalf of civil society (Skoll Foundation, 2013).
Through its collective advocacy approach, Crisis Action has saved thousands of lives.
Though many of these lives saved would likely be from the subsistence population, Ms.
Mortensen would be considered a social entrepreneur who operates in a non-subsistence
marketplace.
Marketing guidelines for operating in subsistence marketplaces
Weidner, Rosa, and Viswanathan (2010) identify a set of marketing practices that
are used by successful organizations and companies in subsistence marketplaces. These
entities include ‘(1) companies pursuing a traditional profit-maximization agenda, (2)
companies that have incorporated social responsibility into their strategic intent, and (3)
social enterprises’ (p. 559). The marketing practices include: researching and
understanding subsistence marketplaces, identifying critical needs, negotiating social
networks, determining the value proposition and co-creating products that are produced
locally with sustainable packaging. Communication to subsistence consumers, ensuring
access to products, and management of the adoption process further describe the

13. 12
essentials of marketing in subsistence contexts. researching and understanding
subsistence marketplaces,identifying critical needs, negotiating social networks,
Ddesigning the value proposition
Based on various case study examples they generate a list of guidelines for
managers of organizations or companies that operate in subsistence marketplaces. Some
of these are included in Table 1. For instance, in the area of negotiating social networks,
they recommend that managers ‘harness one-to-one relationships and rich social
networks’ and ‘negotiate formal and informal economies, relationships grounded in
social contracts, and local norms’ (Weidner et al., 2010, p. 560). These particular
suggestions clearly reflect the aforementioned notion of marketing “with” the
impoverished, yet the managerial implications are primarily reflective of organizations
marketing to, or social entrepreneurs marketing for or on behalf of the poor, not
necessarily with them. To provide guidance and tools for marketers, particularly those
working as or with social entrepreneurs, to genuinely and sustainably engage with
subsistence marketplaces, Santos and Laczniak’s (2009) normative framework, the
Integrative Justice Model (IJM) is proposed. The five key elements of the IJM provide a
framework for marketers to check and re-check their decisions to ensure fairness and
sustainability in their efforts. These five ethical checkpoints, originally developed for
multinational corporations (MNCs) engaging in low-income markets, and recently
adapted to social entrepreneurial organizations (Santos, 2013), complement the set of
marketing guidelines that Weidner, Rosa, and Viswanathan (2010) derive from an
examination of successful business practices in subsistence marketplaces. Based on the
normative guidelines of the IJM model and the positive suggestions for marketing

14. 13
practices that Weidner et al. (2010) make, tactics for marketing planning are proposed
that are aimed at social entrepreneurs who operate in subsistence marketplaces.
The integrative justice model for impoverished populations
The IJM is constructed using a normative theory building process rooted in philosophy
(Bishop, 2000). According to the formulators of the model, the key elements of the IJM
are arrived at based on an examination of different strands of thought in moral philosophy,
management theory, and religious doctrine and their implication for engaging
impoverished populations. The theories examined are: (a) Catholic social teaching; (b)
Juergen Habermas’ discourse theory; (c) Immanuel Kant’s categorical imperative; (d)
John Rawls’ difference principle; (e) William Ross’ theory of duties; (f) Amartya Sen’s
capability approach; (g) Alasdair McIntyre’s virtue ethics; (h) John Stuart Mill and
Jeremy Bentham’s classical utilitarianism; (i) Service-dominant logic of marketing; (j)
Socially responsible investing; (k) Stakeholder theory; (l) Sustainability perspectives; and
(m) Triple bottom line (Santos & Laczniak, 2012).
When these perspectives are examined together, they ‘reveal certain ethical
requirements that, in general, should guide the fair allocation of income, wealth and
power in the market economy’ (Santos & Laczniak, 2012, p. 3). These ethical
requirements are: (1) an authentic engagement with customers with non-exploitative
intent; (2) co-creation of value; (3) investment in future consumption; (4) interest
representation of all stakeholders; and (5) long-term profit management (Santos &
Laczniak, 2009). These key elements are to be considered in their entirety as distinct and

15. 14
symbiotic dimensions of what constitutes a just and fair marketplace especially for the
impoverished.
Marketing planning for SEMs in subsistence marketplaces In Marketing 3.0, Kotler,
Kartajaya, and Setiawan (2010) discuss changes in the macroeconomic environment that
have led to significant changes in consumer behavior, and in the field of marketing. Over
the past sixty years marketing has gone from product-centric (Marketing 1.0), to
customer-centric (Marketing 2.0), and today marketing is transforming again in response
to new dynamics in the marketing environment indicating an expanded focus from
products to consumers to issues affecting humankind. ‘Marketing 3.0 is the stage when
companies shift from consumer-centricity to human-centricity and where profitability is
balanced with corporate responsibility’ (Kotler, Kartajaya, & Setiawan, 2010, p. xii).
Newbert (2012) recently investigated whether or not social entrepreneurs follow
best marketing practices. He found that for-profit social entrepreneurs were no less likely
than commercial entrepreneurs to conduct preliminary financial planning for their
enterprises at the start-up phase. Further, they were no less likely to develop full business
plans, and no less likely to price according to fair market value. These findings suggest
that, at the outset, social entrepreneurs build the essential foundations for a successful
business from which marketers can effectively launch their planning efforts (Newbert &
Hill, 2010). However, Newbert (2012) also found notable differences between social and
commercial entrepreneurs in execution of best marketing practices. Social entrepreneurs
were found to be less likely than commercial entrepreneurs to consider market data
critical to starting their venture and less likely to consider changes to the market and

16. 15
product. Newbert (2012) suggests that because social entrepreneurs tend to lack formal
education in business (Amin, 2009) they may lack the marketing skills of their
commercial counterparts, which are critical to the success of new ventures (Peltier &
Scovotti, 2010). Given that market research is less likely to be considered critical to
success by social entrepreneurs, marketing planners must work to overcome this
hesitation to delve into the data and analysis that is required for developing effective
strategy and identifying unmet demand in their markets of interest (Kirzner, 1997). For
example, in subsistence settings, implementing market research and analysis as part of
the planning process, can help entrepreneurs address their social problems of interest in
different ways, potentially changing their business activities based on the needs of varied
market segments.
The IJM as a Framework for Marketing Planning with Subsistence Consumers
As a normative framework, the IJM proposes how things ought to be. As discussed, when
considering MNCs, its tenets provide managers an ethical outline for marketing to the
poor. For SEOs, its elements suggest a framework that truly benefits the poor when
operating on their behalf. In subsistence marketplaces, the IJM offers a viable solution to
effective marketing planning with the impoverished, which is essential in this context.
Using insights from Weidner et al., (2010) to articulate the nuances associated
with subsistence marketplaces and the subsequent managerial implications, tactics for
marketing planning in this unique context are offered with applied examples of using the
IJM with the subsistence consumer (Table 1).

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18. 17
Table 1: IJM Adaptations for Social Entrepreneurship Marketing
IJM for MNCs
(Santos &
Laczniak, 2009)
IJM for SEOs
(Santos, 2013)
Marketing in Subsistence Marketplaces
(Weidner et al., 2010)
Tactics for SE Marketing
Planning in
Subsistence Marketplaces
SEM to poor SEM for poor SEM with poor
Authentic
engagement
with consumers,
particularly
impoverished
ones, with non-
exploitative
intent
Authentic
engagement aimed
at empowerment
particularly of
disadvantaged
groups
Process Step
Managerial
Implications
 Cultural immersion experiences
 Build trust with transparency in
value chain
 Understand political
environment, rights and
resources
1. Research markets
2. ID critical needs
3. Negotiate social
networks
 Participatory
research
 ID needs of value
chain
 Harness 1-1
interactions & rich
social networks
Co-creation of value
with
customers,
especially those
who are
impoverished or
disadvantaged
Social and
environmental
value co-creation
aimed at solving
the root causes of
problems
associated
with poverty
4. Design value
proposition
5. Co-create
products (and
services)
 Challenge and
rethink traditional
business
 Understand &
incorporate
consumer needs
 Extensive small group
discussions with potential
beneficiaries on problem
identification
 Identify leaders, evaluate social
capital
 Co-create innovative solutions
by segment
 Include beneficiaries’
recommendations in solution
processes
Investment in future
consumption
without
endangering the
environment
Creation of
sustainable
ecosystems
through a process
of innovative
social change
6. Localize
production
7. Develop
sustainable
packaging
 Increase livelihood
opportunities,
awareness,
networking
 Reduce
transportation costs
 Increase
product/svc.
Transportability
 Use biodegradable
or recyclable local
materials
 ID subsistence market
segments
 Map product/service life cycle
– understand consequences &
opportunities
 Increase capabilities for
participation (education,
business skills, customer
service training)
 Disintermediation
Interest
representation
of all stakeholders,
particularly
impoverished
customers
Interest
representation of
all stakeholders,
particularly
impoverished and
disadvantaged
segments
8. Communicate to
consumers
9. Provide access to
products/services
 Innovative
communication
through brand name
selection
 Demos and WOM
advertising, local
partners
 Enlist local resellers
to provide access
 Clarify stakeholder advantages
 Develop stakeholder strategies
that ensure ethical economic
exchange to benefit all
 Develop metrics to ensure
sustained advantages
 Conduct ethics audits through
group meetings
Focus on long-term
profit
management rather
than
on short-term profit
maximization
Financial viability
and
sustainability
10. Manage the
adoption process
 Tailor solutions
around high
interdependence
 1 on 1 interactions
 Evaluate social, economic and
environmental sustainability
initiatives
 Develop strategic plan with
long-term focus and timeline
for implementation
 Develop and monitor co-
created metrics particular to
organization

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Authentic engagement
For the MNC engaging with the impoverished, an essential ingredient to authentic
engagement is “non-exploitative intent.” Inadvertent exploitation such as overpricing,
unfair dealing, or avoidance of social sustainability initiatives, could be unanticipated
consequences of the demands required of the for-profit firm focused on increasing
shareholder wealth. Applied to the SEO, the key to authentic engagement is
“empowerment” of the impoverished so as to allow for true, self-sustaining, and long-
term benefit. Santos (2013) suggests that if SEO managers want to maintain the locus of
control, their desire is likely to be indicative of an unsustainable SEO.
Weidner et al. (2010) identify three steps in the marketing process in subsistence
marketplaces that are reflective of authentic engagement aimed at building trust and
empowering those served: research the markets, identify critical needs, and negotiate
social networks. Managerial implications suggest participatory research (which might be
in the form of rural appraisals, wealth ranking, or financial diaries), understanding the
needs of suppliers, and harnessing the social value of 1-to-1 interactions and rich social
networks. Applying the IJM element of authentic engagement, informed by the
managerial implications, several tactics for marketing planning in subsistence contexts
emerge.
Foremost, a cultural immersion experience is essential for true engagement.
Forms of immersion might include cross-functional management and marketing teams
uniting for a 10-day trip to the subsistence marketplace under consideration. Planning
objectives might include trust building, “getting to know you” games, home-stays, and
cultural festival participation. Marketers would benefit from detailing the perspectives of

20. 19
partners in the “value chain” associated with solving a particular problem. Further, it is
imperative that the marketer understands the political environment as well as the rights of
the impoverished consumer and the extent to which those rights are upheld or discarded.
Finally, authentic engagement requires an evaluation of the resources available to the
deeply impoverished. Aside from an obvious lack of financial resources, other valuable
resources in a subsistence market are likely to include social capital and networks,
intellectual and spiritual development opportunities, natural resources, health and
education programs, and opportunities for competitive collaboration.
Value co-creation
The concept of value co-creation is at the core of the service-dominant logic of
marketing (Vargo & Lusch, 2004). In order to serve the impoverished more effectively,
social entrepreneurs that operate in subsistence marketplaces should carefully investigate
the root causes of a problem, as identified by the poor they serve. The process steps
associated with value co-creation include designing the value proposition and actually co-
producing products or services with the impoverished consumer. Managers and marketers
are challenged to reconsider traditional business planning and meaningfully consider the
subsistence context as they design solutions.
Tactics to garner the information that can serve as a foundation for co-creation
might include extensive small group discussions to understand the problems and their
root causes. Leaders need to be identified and the social capital and networks evaluated,
to help form market segments. Karlan and Appel (2012) found that cooperation in micro-
lending groups was stronger when participants were culturally similar, and that they

21. 20
monitored one another more effectively. Such segments or groups offer increased social
capital, which can facilitate innovation in problem identification and solution design.
Marketing planners should engage impoverished participants in scenarios that encourage
them to envision a lifestyle inclusive of the solution.
Investment in future consumption
The IJM requires marketers to consider the social, environmental and economic
impacts of their decisions. A firm is expected to invest in research and development
aimed at developing innovations for impoverished markets that are socially beneficial an
environmentally friendly (Santos & Laczniak, 2012). Social entrepreneurs operating in
subsistence marketplaces should create sustainable ecosystems through a process of
innovative social change, striving to increase the capabilities of the impoverished
segment so they can better participate in the market economy.
The marketing process steps in a subsistence context include localizing
production and developing sustainable packaging for products and sustainable programs
for services. This implies marketers need to increase livelihood opportunities and
awareness of these opportunities, utilizing the rich social networks of subsistence
marketplaces. Transportation costs must be reduced to make products and services more
accessible and transportable. Products should use biodegradable materials and local
components when possible. The social entrepreneur in this context should focus on
identifiable market segments, considering the nuances, needs and values of a particular,
even if small, market segment. The product or service life cycle should be mapped so as
to understand the consequences of product or service design, and to explore opportunities

22. 21
for innovation and improvement. To increase the capabilities of the persons served so
they can more effectively participate in the market economy, the social entrepreneur
should focus on business skills training in areas such as customer service, basic
bookkeeping, and marketing principles. Finally, to facilitate sustainable investment in
future consumption, the social entrepreneur should work toward disintermediation, which
suggests a more sustainable approach to distribution with fewer intermediaries in the
economic exchange (Martin and Schouten, 2012). Understanding supply chain
relationships is imperative, as is an awareness of the social impact of disintermediation
efforts.
Interest representation of stakeholders
While the MNC will assuredly put a primary focus on increasing shareholder
wealth, regardless of marketplace, the social entrepreneurial organisation is expected to
put equal focus on all stakeholders including the poor served by the organisation,
employees and volunteers. This requires consistent communication with consumers and
consistent access to the products or services associated with social problem resolution.
Marketing managers should offer subsistence consumers brand names that easily identify
the offering. Clear brand messages and value propositions are essential so as to be shared
and demonstrated via word-of-mouth (WOM) advertising, and distributed via
collaborative local partnerships. Marketers planning strategies in the subsistence context
should work to clarify stakeholder advantages. Further, marketers can help them envision
a collaborative plan and how the results will affect them personally, and their social
group as a whole.

23. 22
The ethics of economic exchanges should be discussed, for example within small
groups and demonstrated with interactive scenarios and role-playing with larger groups.
Once stakeholder advantages are clear, uncomplicated, simple metrics can be developed
to ensure such advantages are maintained consistently throughout the economic exchange.
For example, a Honduran woven bracelet sells for $3 to an American tourist. The teenage
Honduran entrepreneur is encouraged to use one of the three dollars to pay for more
weaving thread, one should be given to the outlet (store) where the bracelet was sold, and
one is kept as profit. How many bracelets will the teen need to sell in order to purchase a
second-hand dress for her quinceanera (15th birthday, coming-of-age celebration)?
Understanding the advantages and motivations of each stakeholder in the process is
essential to helping the impoverished plan their approach to the marketplace.
Long-term profit management
While the MNC is encouraged to take a corporate social responsibility approach
which suggests a long term commitment to an impoverished market versus the more
comfortable notion of short term profit maximization, the social entrepreneur focuses on
financial viability and sustainability. This portion of the marketing process requires
managing the adoption process with solutions that consider the high levels of
interdependence between partners in the exchange. Recall that consumers are often also
entrepreneurs themselves with a vested interest in consistent exchanges, and the 1-to-1
nature of the exchange. For marketers in the subsistence context, this suggests long term
planning with those served, in an effort to understand the social, environmental and
economic consequences of the market exchange (e.g., saving to purchase additional

24. 23
thread to make more bracelets; using locally produced, high-quality thread, purchased
from another person in the village). Long term strategic planning inclusive of timelines
for implementation of programs and services should consider the varied nuances of
subsistence marketplaces; yet reflect the innovative and tenacious nature of the
impoverished consumer/entrepreneur. Marketers need to ensure their plans truly amplify
the voice of the poor, and are reflective of the shared vision of the subsistence
marketplace in which they function.
Conclusion and future research
SEMs in subsistence marketplaces have invaluable resources for development
including rich social networks and a market with a propensity toward word-of-mouth
marketing. The one-on-one nature of subsistence marketplaces is a particular advantage
that can be amplified with the IJM. Modified marketing approaches that accurately
identify and genuinely consider the needs of the impoverished consumer, such as low
literacy and numeracy and their hidden implications, are required in order to evidence
authentic respect for the disadvantaged marketplace. The IJM provides a framework for
those marketing to, for and/or with the poor, to evaluate their strategies and plans and
discern the extent to which their efforts address, reflect and respect their impoverished
marketplace. The IJM is shown to be particularly useful for social entrepreneurs in
subsistence marketplaces due to its adaptability when marketing with the impoverished as
should be the norm in sustainable human development.
In regard to future research it should be pointed out that market research methods
must be adapted to include a more qualitative approach, yet must accurately reflective the

25. 24
potential of a marketplace. More robust qualitative methods that generate more
information from less data will enable social entrepreneurs, particularly those in
subsistence marketplaces, to train and assist subsistence entrepreneurs in marketing
planning in these innovative contexts. Research among multinational corporations
marketing to the poor should evaluate the extent to which their marketing approaches
reflect the elements of a just marketplace. The potential for training marketers engaged
with the impoverished on how to identify adherence to the IJM should be investigated.
Finally, researching methods for training social entrepreneurs how to market to, and teach
marketing to, subsistence entrepreneurs is an area of continued opportunity.

26. 25
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